Banking
LC Cash Margin Collected from Customer
Blocking a cash margin from the customer's account as collateral for issuing an LC.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Customer Current Account | Liability (-) | 20,000.00 | - |
| LC Margin Deposits (Liability) | Liability (+) | - | 20,000.00 |
💡 Accountant's Note
The margin is a separate restricted deposit. It reduces the bank's credit risk on the LC. The customer's current account is debited and a specific LC margin account is credited.
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